Neither conservatives nor liberals disagree that these unions raise wages and employment for their members (i.e., firefighters, teachers and police). But research I recently completed finds a solid empirical relationship between public sector unions’ concentration and the size and cost of state government, suggesting that what’s good for the public sector employee goose might not be good for the taxpayer gander.
Over the last three decades, union membership in the private sector has fallen precipitously, from 24.2% in 1973 to just under 7% in 2011. Over the same period, public sector union membership jumped by 14 points, from 23% to 37%.
The different directions of these trend lines have much to do with the nature of public sector employment. For instance, unlike the private sector, public sector wages that exceed an employee’s productivity don’t directly threaten employment — if you need proof of this point, head down to your local DMV office.
The excess cost of overpaid public employees is deflected onto taxpayers. Many states, including my home state of California, are learning the hard way that there’s a limit to this tax-and-spend cycle.